{"id":2148060,"date":"2026-10-14T18:56:58","date_gmt":"2026-10-14T16:56:58","guid":{"rendered":"https:\/\/kohenavocats.fr\/2026\/10\/14\/foreign-company-france-partner-blocks-deadlock-sas-exclusion-abroad\/"},"modified":"2026-10-14T18:56:58","modified_gmt":"2026-10-14T16:56:58","slug":"foreign-company-france-partner-blocks-deadlock-sas-exclusion-abroad","status":"publish","type":"post","link":"https:\/\/kohenavocats.fr\/en\/2026\/10\/14\/foreign-company-france-partner-blocks-deadlock-sas-exclusion-abroad\/","title":{"rendered":"Your Business Partner Blocks Every Decision in Your French Company While You Live Abroad: Deadlock, Forced SAS Shareholder Exclusion and Emergency Court Action"},"content":{"rendered":"

You created a French company with a local partner, you returned home, and now every decision is stuck: the partner refuses to approve the accounts, blocks the capital increase the business needs and answers your emails with silence. From abroad, this deadlock feels impossible to break, because French company law requires shareholder votes for almost every important step. This guide explains what a foreign shareholder living outside France can do when a business partner blocks everything: how to document the deadlock from a distance, how to ask the emergency commercial court judge to appoint a provisional administrator, and how to force the blocking shareholder out of a French soci\u00e9t\u00e9 par actions simplifi\u00e9e<\/em> (SAS, the flexible joint-stock company most foreign founders choose) through a statutory exclusion clause, with the buyback price, the registration duty and the court safeguards around it. You will also see why the SARL (the rigid limited-liability company) offers no equivalent exit, when dissolution for deadlock becomes the last resort, and which filings with the greffe<\/em> (the court clerk keeping the company register) must follow.<\/p>\n

I. Your partner blocks every vote in France: what deadlock means and how to react from abroad<\/h2>\n

Deadlock in a French company rarely looks like a dramatic boardroom fight. From abroad, it usually looks like silence: no reply to the notice of meeting, no vote on the annual accounts, no signature for the bank, no approval of the new hire the subsidiary urgently needs. Before asking a judge for anything, you must understand what French law treats as a real deadlock, because courts distinguish a simple disagreement, which is part of company life, from a paralysis that threatens the company itself. The distinction decides whether you obtain an emergency administrator, an exclusion or nothing at all, and it shapes every letter your lawyer will send from Paris while you stay abroad.<\/p>\n

A. How to prove the deadlock from abroad: blocked votes, meeting minutes and written proof<\/h3>\n

A French judge never takes your word that the company is blocked; the judge reads papers. The first reflex of a shareholder living in London, New York, Montreal or Singapore must therefore be to build a paper trail that shows, meeting after meeting, that collective decisions required by law or by the articles cannot be adopted. In a SAS, the starting point is the articles themselves, because Article L. 227-9 of the Commercial Code states that “Les statuts d\u00e9terminent les d\u00e9cisions qui doivent \u00eatre prises collectivement par les associ\u00e9s dans les formes et conditions qu’ils pr\u00e9voient”<\/a>. Read that clause first: it lists which decisions need a collective vote in your company, in which form, and with which majority. Every time your partner prevents one of those decisions, you need a dated document that records the failure.<\/p>\n

In practice, proving deadlock from abroad means sending formal notices that leave traces. Convene the shareholders in writing, even when you know the partner will not attend or will vote no, and keep the proof of sending and receipt for each notice. If the articles allow voting by correspondence, videoconference or electronic means, use those tools and keep the connection logs, the returned ballots and the screenshots of the vote. When the meeting produces no valid decision, draw up minutes that state exactly what happened: who was convened, who attended, what majority was required, how each shareholder voted, and why the resolution failed. Have the minutes signed by those present and send a copy to the absent partner by traceable means. Two or three such documented failures, spread over several months and covering different topics such as the annual accounts, a capital increase or the appointment of the statutory auditor, weigh far more than a year of angry emails.<\/p>\n

Your correspondence itself is evidence, so write every message as if the president of the commercial court will read it. State the decision the company needs, the deadline imposed by the business, the legal text or article clause that requires a vote, and the consequences of refusal, in calm and precise terms. Ask for a written position within a stated time, and note each refusal or each silence in a short summary email. Bank statements showing unpaid suppliers, the auditor’s reminders about the accounts, or a landlord threatening termination because a lease renewal was never approved all turn an abstract quarrel into a concrete threat to the company. Foreign shareholders often underestimate this point: living abroad is not an excuse for missing meetings, and courts expect you to use every remote voting tool the articles offer before claiming you are powerless.<\/p>\n

One right deserves special attention because partners sometimes try to strip it away. Article 1844 of the Civil Code provides that “Tout associ\u00e9 a le droit de participer aux d\u00e9cisions collectives”<\/a>, and this principle limits what an exclusion or suspension clause can do to a shareholder before the buyback is completed. The Commercial Chamber of the Court of Cassation confirmed the strength of this rule when it reviewed a SAS whose articles provided that a shareholder facing exclusion could not vote on his own exclusion: the dispute in Cass. com., 9 July 2013, No. 12-21.238<\/a> shows that any clause touching voting rights is examined against this mandatory provision, and the Court recalled in that case that “il n’entre pas dans les pouvoirs du juge de se substituer aux organes de la soci\u00e9t\u00e9 en ordonnant la modification d’une clause statutaire au motif que celle-ci serait contraire aux dispositions l\u00e9gales imp\u00e9ratives applicables”. The lesson for a foreign shareholder is double: draft the articles carefully before the crisis, and during the crisis, never accept an informal statement that you or your partner are suddenly deprived of voting rights without a written statutory basis.<\/p>\n

For readers who set up their French business through the standard incorporation path, the practical incorporation steps, the Kbis extract (the official identity card of a French company issued by the greffe<\/em>), the corporate bank account and the VAT registration are described in our guide to setting up a company in France as a foreign founder<\/a>. That background matters here because the deadlock often starts at the first annual accounts: the foreign majority shareholder discovers that the local partner refuses to approve them, and the six-month deadline for approving accounts suddenly becomes a weapon.<\/p>\n

B. How to ask the emergency judge to appoint a provisional administrator from abroad<\/h3>\n

When documented deadlock turns into a genuine threat to the company, the fastest judicial lever is the emergency application to the president of the commercial court for the appointment of a provisional administrator (administrateur provisoire<\/em>), a neutral outsider entrusted with running the company or with a defined mission such as convening a meeting. The procedure is the commercial r\u00e9f\u00e9r\u00e9<\/em>, the French emergency hearing that delivers an order within weeks. Article 872 of the Code of Civil Procedure provides that “Dans tous les cas d’urgence, le pr\u00e9sident du tribunal de commerce peut, dans les limites de la comp\u00e9tence du tribunal, ordonner en r\u00e9f\u00e9r\u00e9 toutes les mesures qui ne se heurtent \u00e0 aucune contestation s\u00e9rieuse ou que justifie l’existence d’un diff\u00e9rend”<\/a>, and Article 873 adds that “Le pr\u00e9sident peut, dans les m\u00eames limites, et m\u00eame en pr\u00e9sence d’une contestation s\u00e9rieuse, prescrire en r\u00e9f\u00e9r\u00e9 les mesures conservatoires ou de remise en \u00e9tat qui s’imposent, soit pour pr\u00e9venir un dommage imminent, soit pour faire cesser un trouble manifestement illicite”<\/a>. A foreign shareholder does not need to fly to Paris for this: a French lawyer acts under a written power of attorney, the petition (assignation en r\u00e9f\u00e9r\u00e9<\/em>) is served on the company and on the blocking partner, and the hearing proceeds even if you follow it by phone from abroad.<\/p>\n

The decisive question is the standard of proof, and here the case law is strict. The Paris Court of Appeal restated it on 22 March 2024, No. RG 23\/15250<\/a>: “la d\u00e9signation judiciaire d’un administrateur provisoire d’une soci\u00e9t\u00e9 est possible en r\u00e9f\u00e9r\u00e9 sous r\u00e9serve que soit rapport\u00e9e la preuve de circonstances rendant impossible le fonctionnement normal de la soci\u00e9t\u00e9 et mena\u00e7ant celle-ci d’un p\u00e9ril imminent, s’agissant d’une mesure exceptionnelle”. The same decision warns that “Si la m\u00e9sentente entre les associ\u00e9s ne peut suffire \u00e0 elle seule \u00e0 justifier la d\u00e9signation d’un administrateur provisoire”, the outcome changes when “la paralysie li\u00e9e au conflit entre associ\u00e9s menace celle-ci d’un p\u00e9ril imminent”. In that case, the court kept the provisional administrator because the company no longer rented its properties, its only income had dried up, and a monthly bank loan had to be repaid. Translate this into your file: a quarrel is not enough, but a quarrel plus unpaid loans, lost customers, unapproved accounts blocking the Kbis<\/em> update, or a bank freezing the account because the signatory question is unresolved, meets the test.<\/p>\n

Prepare the petition as a bundle that a judge can read in twenty minutes. Include the articles of association with the voting clauses highlighted, the convening notices and minutes of the failed meetings, the bailiff’s reports (constats<\/em>) if attendance was refused, the auditor’s letters, the bank correspondence, and a short chronological table linking each blocked decision to a concrete danger for the business. Ask for a tailored mission rather than a blank cheque: convening the shareholders to vote on defined resolutions, approving the accounts, or managing current operations for three months, with a reporting duty to the court. Judges prefer limited missions, and a limited mission costs less in administrator fees, which the company advances. If urgency is extreme, for example a bank guarantee about to be called or perishable stock to be sold, the petition can request that the hearing be brought forward, and the president can rule within days.<\/p>\n

Two warnings complete the picture for shareholders living abroad. First, the administrator does not settle the underlying conflict; he unblocks the company temporarily while you negotiate, trigger the exclusion clause or prepare a buyout. Second, every document in a foreign language must be translated into French by a sworn translator, and powers of attorney signed abroad sometimes need legalisation or an apostille depending on the country, so start that paperwork before the crisis peaks. The emergency order itself is served on the company, published where required, and the administrator’s appointment is filed with the greffe<\/em> so that banks and contracting parties see who can validly sign. Used this way, the r\u00e9f\u00e9r\u00e9<\/em> turns distance from a weakness into a procedure: you act through counsel, on papers, within weeks, while the blocking partner must answer a judge instead of ignoring your emails.<\/p>\n

II. Forcing the blocking shareholder out of your French SAS: exclusion clause, buyback price and court control<\/h2>\n

The provisional administrator keeps the company alive, but the conflict remains. In a SAS, French law offers a stronger and permanent tool that does not exist in most other company forms: the statutory exclusion clause, which forces a shareholder to sell his shares when defined events occur. This mechanism is the reason foreign investors are so often advised to choose a SAS rather than a SARL when they take a local partner. The clause must have been written into the articles before the crisis, it must follow strict procedural safeguards, and it ends with a buyback whose price can be reviewed by an independent expert. Each of these steps can be handled from abroad through counsel, but each has traps that have destroyed many files, as the published court decisions show.<\/p>\n

A. What your SAS articles must contain to exclude the blocking shareholder<\/h3>\n

The legal foundation is short and must be read literally. Article L. 227-16 of the Commercial Code provides that “les statuts peuvent pr\u00e9voir qu’un associ\u00e9 peut \u00eatre tenu de c\u00e9der ses actions. Ils peuvent \u00e9galement pr\u00e9voir la suspension des droits non p\u00e9cuniaires de cet associ\u00e9 tant que celui-ci n’a pas proc\u00e9d\u00e9 \u00e0 cette cession”<\/a>. Three consequences flow from this sentence. First, without a clause in the articles, there is no forced exclusion in a SAS: unlike the dismissal of a director, which the shareholders can always vote, the exclusion of a shareholder requires a written clause adopted before the dispute. Second, the clause defines its own triggers, and deadlock itself can be drafted as a trigger, for example the repeated failure to adopt collective decisions, the refusal to approve the accounts two years in a row, or the exercise of a competing activity. Third, the suspension of non-pecuniary rights, mainly voting rights, is only possible “tant que celui-ci n’a pas proc\u00e9d\u00e9 \u00e0 cette cession”, meaning the suspension is a temporary bridge until the sale, not a permanent confiscation of the shareholder’s voice.<\/p>\n

The surrounding articles complete the framework and explain why the SAS dominates joint ventures with foreign partners. Article L. 227-14 allows the articles to provide that “Les statuts peuvent soumettre toute cession d’actions \u00e0 l’agr\u00e9ment pr\u00e9alable de la soci\u00e9t\u00e9”<\/a>, so the buyback of the excluded shareholder’s stake can be directed toward the remaining shareholders or an approved investor rather than an outsider imposed by the departing partner. Article L. 227-19 then sets the voting rule for adopting or amending these clauses: “Les clauses statutaires vis\u00e9es aux articles L. 227-13 et L. 227-17 ne peuvent \u00eatre adopt\u00e9es ou modifi\u00e9es qu’\u00e0 l’unanimit\u00e9 des associ\u00e9s. Les clauses statutaires mentionn\u00e9es aux articles L. 227-14 et L. 227-16 ne peuvent \u00eatre adopt\u00e9es ou modifi\u00e9es que par une d\u00e9cision prise collectivement par les associ\u00e9s dans les conditions et formes pr\u00e9vues par les statuts”<\/a>. Read carefully: the exclusion clause itself follows the majority rules of your articles, but if you want to add it once the crisis has started, the blocking partner will simply vote against it. This is why experienced counsel insert the exclusion clause, the approval clause and a deadlock definition on the day the company is formed, when both partners still agree.<\/p>\n

The procedure written into the clause decides whether the exclusion survives a court challenge, and the 9 July 2013 decision quoted above is the textbook warning. In that case the SAS had excluded a shareholder for competing activity without letting him vote, the excluded shareholder attacked both the exclusion and a later amendment of the clause, and the Court of Cassation held that the judge cannot rewrite the articles in place of the shareholders. The practical message is that courts review the regularity of the vote, the respect of the contractual procedure and the mandatory right to participate in collective decisions, but they do not redesign a badly drafted clause. A robust clause therefore contains five elements: precise triggers with examples, a formal notice describing the alleged facts with supporting documents, a time limit, usually fifteen to thirty days, for the targeted shareholder to reply in writing and be heard, a vote organised exactly as the articles require with the question of the targeted shareholder’s participation settled in advance by the clause itself, and a written decision stating the reasons and the number of shares to be sold.<\/p>\n

From abroad, run this procedure with exaggerated formality. Send the notice by bailiff or by registered letter with acknowledgement of receipt to the partner’s French address, with a copy by email; hold the hearing by videoconference if the articles allow it and record attendance; have a French lawyer chair the process and keep every ballot, proxy and connection record. If the partner refuses to participate, note the refusal in the minutes rather than pretending the step did not exist. The contrast with the SARL is instructive at this point: Article L. 223-14 of the Commercial Code organises the transfer of SARL shares to outsiders around approval by “la majorit\u00e9 des associ\u00e9s repr\u00e9sentant au moins la moiti\u00e9 des parts sociales”<\/a> and a three-month buyback mechanism, but no statute allows the forced exclusion of a SARL shareholder. In a SARL, a blocking minority can only be removed by a court order in narrow cases, by a negotiated buyout, or by dissolving the company. Foreign founders who chose a SARL for its apparent simplicity discover at the moment of crisis that the flexible SAS would have given them the exit they now lack.<\/p>\n

B. How the buyback price, registration and tax work when the shareholder is forced out<\/h3>\n

Once the exclusion is voted, the fight moves to money: how many shares, at what price, paid by whom, and with which tax. The articles should answer these questions, because the statute sends the parties back to their contract first. Article L. 227-18 of the Commercial Code states that “Si les statuts ne pr\u00e9cisent pas les modalit\u00e9s du prix de cession des actions lorsque la soci\u00e9t\u00e9 met en oeuvre une clause introduite en application des articles L. 227-14 , L. 227-16 et L. 227-17 , ce prix est fix\u00e9 par accord entre les parties ou, \u00e0 d\u00e9faut, d\u00e9termin\u00e9 dans les conditions pr\u00e9vues \u00e0 l’article 1843-4 du code civil”<\/a>. The same article adds a strict deadline when the company itself buys the shares: “Lorsque les actions sont rachet\u00e9es par la soci\u00e9t\u00e9, celle-ci est tenue de les c\u00e9der dans un d\u00e9lai de six mois ou de les annuler.” A well-drafted clause therefore names a valuation method, often a multiple of average operating profit or net asset value, designates who buys, the remaining shareholders in proportion to their holdings or a named third party, and sets a payment schedule with interest for late payment.<\/p>\n

When the parties cannot agree on the price, French law imposes an independent valuation that neither side controls. Article 1843-4 of the Civil Code provides that “la valeur de ces droits est d\u00e9termin\u00e9e, en cas de contestation, par un expert d\u00e9sign\u00e9, soit par les parties, soit \u00e0 d\u00e9faut d’accord entre elles, par jugement du pr\u00e9sident du tribunal judiciaire ou du tribunal de commerce comp\u00e9tent, statuant selon la proc\u00e9dure acc\u00e9l\u00e9r\u00e9e au fond et sans recours possible”<\/a>. The expert “est tenu d’appliquer, lorsqu’elles existent, les r\u00e8gles et modalit\u00e9s de d\u00e9termination de la valeur pr\u00e9vues par les statuts de la soci\u00e9t\u00e9 ou par toute convention liant les parties”, which means your valuation formula matters even in dispute: the expert applies it unless it is unworkable. From abroad, you participate through your lawyer, who comments on the expert’s draft report, challenges the valuation multiples with comparable transactions, and checks that minority discounts or control premiums are treated as the clause provides. The expert procedure typically takes several months and its cost is shared or allocated by the judge, so budget for it and keep the company funded in the meantime.<\/p>\n

The transfer itself triggers French registration and filing steps that foreign shareholders often discover too late. Transfers of SAS shares are subject to a registration duty (droit d’enregistrement<\/em>) collected by the tax administration: Article 726 of the General Tax Code opens with the rule that “Les cessions de droits sociaux sont soumises \u00e0 un droit d’enregistrement”<\/a>, with a rate of 0.1% for shares of unlisted joint-stock companies such as a SAS. The transfer deed must be registered with the tax office (service des imp\u00f4ts des entreprises<\/em>) within one month, and the duty is usually paid by the buyer. Beyond tax, the buyback must be recorded in the company’s share movement register, the shareholders’ register updated, and, where the operation changes the distribution of capital or the directors, a filing made through the single digital gateway (Guichet unique<\/em> operated by the Institut national de la propri\u00e9t\u00e9 industrielle<\/em>, INPI) to the National Company Register, with supporting documents published and the Kbis<\/em> updated by the greffe<\/em>. Key company events also appear in the Bulletin officiel des annonces civiles et commerciales<\/em> (BODACC), the official gazette where third parties check French companies. Your Paris counsel and accountant (expert-comptable<\/em>) normally handle these filings while you sign powers of attorney and transfer deeds from abroad, sometimes before a local notary or with an apostille depending on your country of residence.<\/p>\n

If no exclusion clause exists and no buyout can be negotiated, two last-resort paths remain, and both should be understood before they are needed. The first is the negotiated exit: offer a put or call option, possibly with mediation by a neutral third party, because a consensual deed signed by both shareholders avoids years of litigation and is enforceable across borders more easily than a judgment. The second is dissolution for deadlock: Article 1844-7 of the Civil Code lists as a ground for early dissolution “la dissolution anticip\u00e9e prononc\u00e9e par le tribunal \u00e0 la demande d’un associ\u00e9 pour justes motifs, notamment en cas d’inex\u00e9cution de ses obligations par un associ\u00e9, ou de m\u00e9sentente entre associ\u00e9s paralysant le fonctionnement de la soci\u00e9t\u00e9”<\/a>. Judges treat dissolution as a remedy of last resort: they grant it only when paralysis is proven and no other solution, administrator, buyout or clause, can save the company. It ends the business, triggers liquidation, and usually destroys value, which is precisely why it pressures both sides toward a settlement once the petition is filed and the judge asks whether an exit can still be organised.<\/p>\n

Conclusion<\/h2>\n

A blocking partner in a French company is a serious problem, but it is a documented and solvable one when you act in the right order. Build the written proof of each blocked vote, use the emergency commercial judge to appoint a provisional administrator when the company’s survival is at stake, and, in a SAS, trigger the exclusion clause whose price and procedure your articles defined in calmer days. Each step, from the convening notice to the expert valuation and the tax registration, can be completed while you live abroad, provided a French lawyer holds proper powers of attorney and every document is translated and filed with the right registry. The founders who suffer most are those who chose a rigid structure without an exit, ignored the first blocked meetings, or tried to starve the partner out instead of following the procedure. Check your articles today, line by line: if the exclusion clause, the deadlock definition and the valuation method are there, a deadlock becomes a manageable dispute; if they are missing, amending the articles while both partners still talk is the most valuable meeting your company will ever hold.<\/p>\n","protected":false},"excerpt":{"rendered":"

Your French business partner blocks every vote while you live abroad. 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